Custom, Excise & Service Tax Tribunal
M/S. Dr. Reddy S Laboratories Ltd vs Cc,Ce&St, Hyderabad-Iv on 22 September, 2016
CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL REGIONAL BENCH AT HYDERABAD Bench SMB Court I Appeal No.E/23451/2014 (Arising out of Order-in-Appeal No.46/2014-15(H-IV)CE dt. 25/07/2014 passed by CC,CE&ST(Appeals-II), Hyderabad) For approval and signature: Honble Ms. Sulekha Beevi, C.S., Member(Judicial) 1. Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982? 2. Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? 3. Whether their Lordship wish to see the fair copy of the Order? 4. Whether Order is to be circulated to the Departmental authorities? M/s. Dr. Reddys Laboratories Ltd. ..Appellant(s) Vs. CC,CE&ST, Hyderabad-IV ..Respondent(s)
Appearance Shri B. Seshagiri Rao, Advocate for the appellant. Shri Guna Ranjan, Superintendent(AR) for the respondent.
Coram:
Honble Ms. Sulekha Beevi, C.S., Member(Judicial) Date of Hearing:22/09/2016 Date of decision:22/09/2016 FINAL ORDER No._______________________ [Order per: Sulekha Beevi, C.S.] The issue involved in this appeal is denial of CENVAT credit on input services. The appellants are engaged in manufacture of bulk drugs and drug intermediates and are availing CENVAT credit facilities on inputs, capital goods and input services. The appellants were issued two show-cause notices demanding the credit availed on inputs services to the tune of Rs.28,90,895/-. After adjudication, the original authority allowed an amount of Rs.7,24,455/- and disallowed credit in respect of 16 services amounting to Rs.21,66,440/- and demanded recovery of the same along with interest and imposed penalty of Rs.2,50,000/-. Being aggrieved, the appellants preferred appeal before the first appellate authority who upheld the order passed by the original authority. Hence this appeal.
2. On behalf of the appellant, the learned counsel Shri B. Seshagiri Rao explained the details of credit availed and the input services which was disallowed by the authorities below. The details as put forward by appellant are given in the following table:-
Sl.No. Nature of services Inadmissible credit (Rs.)
1.
Accommodation services 1,38,941
2. Air transport & Air travel 3,85,176
3. Convention services 2,23,040
4. Directors Sitting Fees / reimbursement 4,83,580
5. Design services 1,98,737 6 Mandap Keeper 1,79,029
7. Works Contract Services 4,06,735
8. Event management 39,622
9. Foreign Exchange Broker 7,513
10. Interior Decorator Services 78,587
11. Restaurant Service 20,026
12. Banquet Service 540
13. Authorised Service Station service 11
14. Club Membership services 131
15. Public Relations services 3,813
16. Insurance Auxiliary Service 735
17. Subscription Service 224 21,66,440
3. The learned counsel submitted that the appellant is not pressing the amount of Rs.11/- shown in Sl.No.13 of the above above table pertaining to the input service viz. authorized service station service in the present appeal. So also, he submitted that out of the total amount an amount of Rs.1,73,391/- is not pressed for the reason that the said amount was claimed by appellants as duplication in the show-cause notice. He also pointed out that the said amount is covered by another show-cause notice issued to the corporate office. Therefore the claim in this appeal as per the contention put forward by the learned counsel for appellant is limited to the tune of Rs.20,93,038/-. The learned counsel submitted that the credit in respect of services viz accommodation services, convention service, design services, mandap keeper services, works contract services, interior decorator services, restaurant services, public relations services and general insurance service were allowed by the adjudicating authority vide Order-in-original dt. 30/06/2016 for the subsequent period. Further in respect of air travel services and other services in the appellants own case, the Commissioner(Appeals) vide order No.124&125/2013 dt. 15/11/2013 has allowed the credit. The learned counsel has also relied upon the judgment rendered in the case of M/s. Reliance Industries Ltd. Vs. CCE&ST, LTU, Mumbai [2016-TIOL-2392-CESTAT-MUM] wherein the co-ordinate Bench of the Tribunal has allowed the credit on all the services which are in dispute in the present case. It has also to be mentioned that the Department has no case that the services were used for personal consumption of any employee of the appellant. In view thereof following the view taking in the above decisions, I hold that the denial of credit is unsustainable. The impugned order is set aside and the appeal is allowed with consequential reliefs, if any. (Pronounced and dictated in open court) SULEKHA BEEVI C.S. MEMBER(JUDICIAL) Raja.
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